By Isabel Gorst in Moscow and Mure Dickie in Beijing
China has signed an agreement with Turkmenistan to produce gas in the former Soviet republic and transport it via a new pipeline that could open up the first non-Russian route for gas exports out of landlocked central Asia.
Chinese state media said yesterday that the deal£¬ sealed by the China National Petroleum Corporation (CNPC) and Turkmengas£¬ Turkmenistan¡¯s state gas company£¬ marked a ¡°substantial step¡± towards realisation of an earlier pact between the two countries.
Turkmenistan last year agreed to supply China with 30bn cubic metres of gas a year for 30 years via a new pipeline to be funded by the Chinese. But the field¡¯s location£¬ the pipeline route and the price of future Turkmen gas exports to China have never been released. Analysts speculate that the agreement£¬ inked during a state visit by Gurmanguly Berdymukhammedov£¬ Turkmenistan¡¯s president£¬ to China this week£¬ might not be final.
Julian Lee£¬ a senior energy analyst at the Centre for Global Energy Studies£¬ said Turkmenistan ¡°had played gas customers off against one another in the past and would probably continue to do so in future to leverage the highest price from buyers¡±.
The only pipeline route for gas exports out of landlocked central Asia goes through Russia£¬ which doubled the price it paid for Turkmen gas last year amid growing competition from other buyers.
Mr Berdymukhammedov£¬ who took power last December after the death of Saparmurat Niyazov£¬ the former president£¬ and was re-elected earlier this year ¨C has promised Russia extra gas supplies. But he has also kept Turkmenistan¡¯s options open on new routes to markets in China£¬ Turkey£¬ Pakistan and Europe£¬ which could be supplied via a pipeline across the Caspian Sea.
Sergei Naryshkin£¬ Russia¡¯s first deputy prime minister and special representative for integration and co-operation with the Commonwealth of Independent States£¬ said last week an agreement£¬ announced in May£¬ on two pipeline pro-jects that would eventually allow Russian gas imports from Turkmenistan to double would be finalised in September.